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These two Acts single-handedly changed the banking industry by encouraging "merger mania." John Dingell, a Democratic representative from Michigan, argued that the passage of GLB would result in a group of institutions that would be "too big to fail" and subject the government to bailing them out if they ran into trouble. Dingell stated, "The last time the U.S. deregulated the savings and loans sector of the economy it brought about a $500 billion dollar taxpayer debacle (Congress floor)." Four megabanks emerged as a result of massive industry consolidation through roll-up acquisitions. These four banks control $7.7 trillion in assets or 56.8% of the entire total in the United States. This legislation led to the economic stability and power of the country being placed into the hands of just a few financial institutions. .
In 2008, when the financial crisis hit, Congressman Dingell's worst fears came to fruition. In Too Big to Fail, author Andrew Sorkin tells how, "The big brokerage firms had been bolstering their bets with enormous quantities of debt. Wall Street firms had debt to capital ratios of 32 to 1. This strategy worked spectacularly well, validating the industry's complex models and generating record earnings. When it failed, the result was catastrophic. (Sorkin, 6)." Bank of America didn't allow its debt to grow this large but it made risky investments because of the long-running bull market. Countrywide Financial was a gamble since rumors swirled of impending bankruptcy and a possible fraudulent foreclosure scandal. Bank of America merged anyways and became a dominant player in the subprime mortgage market. The gamble didn't pay off though, as Countrywide ultimately imploded from litigation concerning faulty origination and servicing of subprime mortgage loans. Then in 2008, "The $2 trillion subprime market collapsed, unleashing global contagion (Sorkin, 6).
